Corruption, or Perception of Corruption, in Privatization

So, the guy hired to be the emergency manager of Detroit public schools to get them out of a severe financial crisis, has hired his old consulting firm in a no-bid contract to help him create a plan to fix the school’s finances.

Details here.

Interesting case. On one hand, he can make a case that the firm is a good choice to do the work and the terms and price of the contract are reasonable. On the other hand, come on! The perception of corruption is obvious, especially in Detroit where political corruption is such a huge problem. Even if his old consulting firm is really the best of the job, there are other firms that are as qualified and competent that would avoid any fear of inside deals or kickbacks.

Preventing corruption and protecting the public interest in contracting means keeping all transaction clean and establishing transparency and accountability and avoiding conflicts of interests of the appearances of them.